Eur/usd - page 413
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EUR/USD Fundamental Forecast – March 28, 2016 The EUR/USD dipped 16 points on the holiday to trade at 1.1160 with no data except for US GDP due late in the day with most markets closed. U.S. releases on Thursday showed fewer jobless claims than forecast in the week through March 19 and durable goods orders fell less than projected last month. American data have steadily improved over the last few weeks, with Bloomberg’s gauge of economic surprises climbing to the most positive level in more than a year.
“The data should continue to strengthen, it should continue to surprise a little bit and that should be sufficient for them to go in June,” Binky Chadha, chief global strategist at Deutsche Bank AG, said in an interview on Bloomberg Television. The upside for the greenback may be limited as “the dollar itself has also priced in a lot.”
Euro area economic growth is expected to accelerate further over the next several years but weak external demand and a slowdown in emerging markets will dampen the recovery, the European Central Bank said on Thursday in a regular economic bulletin.
In an outlook that is broadly in line with the ECB's projections presented at the March 10 rate meeting, the bank added that government debt will decline only gradually and further consolidation is needed to set the public debt ratio on a downward path.
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EUR/USD forecast for the week of March 28, 2016
The EUR/USD is trading at support at 1.1170. Price has managed to stay in the ascending trading channel and if this level holds then we might see the pair reach 1.1450 next month. First support 1.1170, first resistance 1.1230.
On the last Friday’s session the EURUSD fell but with a narrow range and closed near the low of the day, however closed within the previous day range, suggesting a weak bearish momentum.
The pair is trading below the 10-day moving average that is acting as a dynamic resistance, however is still above the 50 and the 200-day moving averages that are acting as dynamic support.
The key levels to watch are: The previous swing high at 1.1342 (resistance), a daily resistance at 1.1237, the 10-day moving average at 1.1215 (resistance), a daily support at 1.1097, and the 50 day moving average at 1.1092.
The dollar rose against major rivals on the last day of the week as market liquidity remained low, as most markets were closed for Easter. The euro weakened against the dollar, shielding the session at 1.1164, slightly lower than the previous day.
Morgan Stanley analysts point to two reasons for the rising of the euro. First, last year foreign investors have cut the rate of currency hedging in debt instruments in euros, reinforcing the upward pressure on the currency. Second, over the past few months accelerate the process of diversification of foreign exchange reserves in favor of the euro.
Forex strategists at Barclays Capital noted that the decline in EUR/USD in the 1.1145 area would strengthen the bearish forecast for the pair as the next target is the area around 1.1055.
EUR/USD: Euro Consolidates, Meanders Around $1.12 The pair added almost 50 pips after the latest US data showed that American households tightened their spending early this year. The greenback is heading toward its first decline after six continuous days of gains.
US consumer outlays edged up a mere 0.1% instead of the expected 0.2% gain in February. Furthermore, the 0.5% increase in spending in January was scaled back to 0.1%.
The pair was seen some 0.40% higher during the early US session, trading around $1.12. Meanwhile, European markets remain closed for Easter Monday.
The single currency is trying to regain some footing after hope for a US rate hike declined last week when the pair lost one big figure, falling below $1.12 from 1.13 in the course of four days.
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Yesterday EURUSD rose with a wide range and closed near the high of the day, in addition managed to close above the previous day high, suggesting a strong bullish momentum.
However the pair did not had the strength to close above the 10-day moving average that is acting as a dynamic resistance, however is still above the 50 and the 200-day moving averages that are acting as dynamic support.
The key levels to watch are: The previous swing high at 1.1342 (resistance), a daily resistance at 1.1237, the 10-day moving average at 1.1205 (resistance), the 50 day moving average at 1.1110 and daily support at 1.1097.
Ahead of Yellen’s speech the pair jumped above 1.12 level.